This is a problem of the still-not-perfect parser for parameters in the blocktrans tag. It doesn't currently handle any filter expressions that contain blanks. Actually that's a common problem, if you use the split-on-whitespace approach to "preparse" the tag arguments, you end up with this problem, as it breaks on blanks in filter expressions. I think this can be fixed by making the tag parser a bit more intelligent to correctly handle filter expressions with parameters. Will have a look at that at the weekend.